Comparable Company Analysis

Investment bankers, private equity analysts, and equity research professionals use this prompt to rapidly structure a peer group and valuation framework when beginning a new coverage initiation, M&A deal, or capital raise — reducing the time to first draft from days to hours.

You are a senior equity research analyst and valuation specialist. I need to build a comparable company analysis (comps) framework for [COMPANY NAME], which operates in the [INDUSTRY] sector. The company is based in [COUNTRY/REGION] and reported [CURRENCY] [LATEST REVENUE] in revenue and [CURRENCY] [LATEST EBITDA] in EBITDA for its most recent fiscal year.

Please structure the comparable company analysis as follows:

1. **Peer Group Selection Criteria**
   Define the criteria for selecting relevant comparable companies, covering: industry classification (primary and sub-sector), geographic focus, revenue size range (typically 0.5x–2x the subject company), business model similarity, and growth profile. List 8–12 hypothetical or named peer companies that would fit these criteria in [INDUSTRY].

2. **Key Trading Multiples to Collect**
   For each comparable, specify which multiples to gather and why each is relevant for [INDUSTRY]:
   - EV/EBITDA (LTM and NTM)
   - EV/Revenue (LTM and NTM)
   - P/E (LTM and NTM)
   - EV/EBIT where depreciation-heavy models make EBITDA less comparable
   - Any sector-specific multiples relevant to [INDUSTRY] (e.g., EV/Subscribers, Price/Book)

3. **Normalization Adjustments**
   Explain how to normalize for the following differences across the peer set:
   - Differences in capital structure (adjust to enterprise value basis)
   - Non-recurring items in EBITDA
   - Different fiscal year-end dates
   - Geographic revenue mix creating growth rate differences
   - Accounting policy differences (e.g., lease treatment under IFRS 16 vs. US GAAP)

4. **Deriving the Implied Valuation Range**
   Walk through the methodology for translating peer multiples into an implied valuation range for [COMPANY NAME]:
   - Apply 25th percentile, median, and 75th percentile multiples to [COMPANY NAME]'s metrics
   - Derive implied enterprise value range
   - Subtract net debt to arrive at implied equity value range
   - Present a football field chart description showing the range across all multiples used

5. **Premium / Discount Assessment**
   Identify factors that would justify [COMPANY NAME] trading at a premium or discount to the peer median — including growth rate differential, margin profile, market share trajectory, management quality, and liquidity.

Present the output as a structured framework with tables and clear section headers suitable for an investment committee presentation.

Prompt Variables

Replace each placeholder with your specific information:

What You'll Get

A peer group selection framework with criteria and 8–12 illustrative comparables, a list of relevant multiples by type with sector-specific additions, a normalization methodology for key differences, a step-by-step implied valuation derivation producing a football field range, and a premium/discount qualitative assessment.

💡 Pro Tip

Specify whether [COMPANY NAME] is publicly traded or private — the AI will adjust the multiple selection and liquidity discount guidance accordingly. For private companies, it will add a 15–30% illiquidity discount discussion to the premium/discount section.

Compatible AI Tools

Related Prompts

Related Resources